Post 2 of 14: The Steemit Whitepaper Broke This Series

I decided on a new post for each one rather than comments. It just looks neater -- and if I'm going to put it as parts, I'd better see a new part as it's own post, y'know?

So onto Whitepaper.
I found a copy of it posted on steemit.

Reading the abstract and table of contents, I feel confusion on many of the terms... including Bitcoin. Likewise, I find the term "full verses fractional" to be creative, because I'm mainly familiar with it in terms of the Federal Fractional Reserve. In addition, I find both of the phrases "fair accounting system that consistently reflects each person's contribution" and "first cryptocurrency that attempts to accurately and transparently reward an unbounded number of individuals who make ?subjective ?contributions ?to its community" intriguing. It seems to match up with my desire to bring some of Eileen Workman's philosophy, of making a currency that relates to the Earth, so we have a resource-based economy - which is also why I'd want to eventually contact members of The Venus Project about this.

One phrase, as I was about done with the table of contents, that stands out to me like a sore thumb, is "Solving Organic Discovery via Search Engine Optimization Shifting Toward Blockchain-based Attribution." Does that not look exactly like the idea that I've presented of Social Wiki? Hyperlinks being the basis? And even before that title: "No Micropayments, Tips Optional Value is in the Links."

Wait wait wait wait wait.
What's this?
One of the things steemit provides is
"Jobs providing above services to other members."
... Can you get a job working for steemit?? I suppose I'd need to know coding better though, wouldn't I?

Well, I like and agree with the first section. 

Onto the next one: Recognizing Contribution.

OMG I LOVE this sentence!:
"Steem is designed from the ground up to address the major barriers to adoption and monetization of a social media based economy."

Oooooo interesting:
"The challenge faced by Steem is deriving an algorithm for scoring individual contributions that most community members consider to be a fair assessment of the subjective value of each contribution."

Hm:
"In a perfect world, community members would cooperate to rate each other's contribution and derive a fair compensation. In the real world, algorithms must be designed in such a manner that they are resistant to intentional manipulation for profit. Any widespread abuse of the scoring system could cause community members to lose faith in the perceived fairness of the economic system."

So, in other words, we live in a world where people do not understand the long-term value of a/the fair evaluation of their and other's material, such that measures against this self-destructive mode of interaction ensure the long-term success of steemit. Ok.

Well... isn't there some measure against this, so that people... AREN'T doing that? Or is that the point of the algorithm... to make it pointless, and thus die out that behavior?

"Existing platforms operate on a one-user, one-vote principle. This creates an environment where rankings can be manipulated by sybil attacks and the service providers must pro-actively identify and block abusers."

You're using this too; why not change the assumption? Or, does the assumption work well, and you need the proper instruments for the proper execution of the idea?

"The fundamental unit of account on the Steem platform is STEEM, a crypto currency token. Steem operates on the basis of one-STEEM, one-vote. Under this model, individuals who have contributed the most to the platform, as measured by their account balance, have the most influence over how contributions are scored."

So, the more money you have, the more influence you have. That seems... problematic. Isn't this the problem of little states forming when the big state is eliminated? Isn't that what the whale hysteria is? Then again, the issue here, first, is not that of being censored. It's that of how much money the person gets. Which makes sense if the person who has contributed a lot (and thus has a lot of money because people voted them up and... wait...)...Wait a second here.
So, where does the money come from?
I'm going to assume a nest egg investment. So, the makers of steemit had the most money, and distribute it via voting on others' posts, giving them money through the upvotes.What creates money? Upvoting SPREADS money. Is the money a constant supply? Where does it come from? Does it "leave" the system when converted to USD?

Questions for later.

I kept reading and realized that I had no idea what "sybil attack" is. So I found out:
"In a Sybil attack, the attacker subverts the reputation system of a peer-to-peer network by creating a large number of pseudonymous identities, using them to gain a disproportionately large influence. A reputation system's vulnerability to a Sybil attack depends on how cheaply identities can be generated, the degree to which the reputation system accepts inputs from entities that do not have a chain of trust linking them to a trusted entity, and whether the reputation system treats all entities identically."

So,
-how cheaply identities can be generated
-the degree to which the reputation system accepts inputs from entities that do not have a chain of trust linking them to a trusted entity
-whether the reputation system treats all entities identically

So, from what I understand of my experience with steemit so far, identities can be pretty easily generated, but they start with a very low reputation threshold, and so their votes don't do much, even collectively; and when the same behavior is applied in unison, it can easily be detected and nullified.Now, this type of thing can become quite complex. The deeper question is, can the system be done such that doing that sort of "cheap shot" simply isn't worth the effort in comparison with just posting your own content, because that would subvert more insidious and planned attacks.

Given that, with steemit, your writing and how you respond to posts is literally? money, ... hey wait a second. That would mean that people could come together and do such attacks not as a bot, but as a social unit. Oh wait. They have. But that's almost more in reference to flagging...Ok, let's go back to this:
"Steem operates on the basis of one-STEEM, one-vote. Under this model, individuals who have contributed the most to the platform, as measured by their account balance, have the most influence over how contributions are scored."

"Have contributed the most"
^ What does that mean?
Does that mean posting the most content? Why could a bot simply use multiple identities and post tons of crap everyday, on all of them, and upvote them with the other identities, and thus having a higher score of influence?This is scarily... blank and completely unaccounted for.

The strange possible reality of this even being a GOOD thing was pointed out by skeptic in this post, and it would sure be nice if steemit would have and use some sort of history and/or save post feature, because I had to go to my history and type in "steemit" and search through at least 30 links before I found the article again!

"Steem is designed around a relatively simple concept: everyone’s meaningful contribution to the community should be recognized for the value it adds."

Um, no:
"one-STEEM, one-vote"I know, I know:
"Steem operates on the basis of"
VS
"Steem is designed around"

The way it operates is opposed to the design intent."When people are recognized for their meaningful contributions, they continue contributing and the community grows. Any imbalance in the give and take within a community is unsustainable. Eventually the givers grow tired of supporting the takers and disengage from the community.

"Then why did you choose to use "one STEEM, one vote"? That's imbalanced in that it's very reductive and simplistic. Sybil simplistic. To the point of irony where a spammy space might actually be financially good for steemit!"The challenge is creating a system capable of identifying what contributions are needed and their relative worth in a way that can scale to an unbounded number of people."

No, the challenge is creating a system that enables and allows productive conversation to flourish. Contributions are not "needed," anymore than a post about puppies is needed. People enjoy posting about puppies, and people enjoy looking at and reading about puppies. There issue here appears to be that of reducing people to "content" and glorifying the content, as opposed to glorifying the types of interaction that are most socially beneficial."A proven system for evaluating and rewarding contributions is the free market."
Right.
Tell that to Rawsome.
And marijuana growers.

I'm being a bastard about this because if you don't take into account certain crucial social heuristics, you're going to be in for one hell of an unpleasant ride, as we've already seen from some of the history of steemit so far.

"The free market can be viewed as a single community where everyone trades with one another and rewards are allocated by profit and loss."

No, steemit is not operating as a free market of trade in basic nature:
You do not have to give a cent to anyone.
You do not have to upvote anyone.
You can simply comment if you wish.

"The market system rewards those who provide value to others and punishes those who consume more value than they produce."

You are unwarrentedly conflating the basic economic system of steemit that you've made with the free market. You've made apples, and now you're talking about the wonders of oranges.

"The free market supports many different currencies and money is simply a commodity that everyone finds easy to exchange. Since the free market is a proven system, it is tempting to try to create a free-market system where content consumers directly pay content producers. However, direct payment is inefficient and not really viable for content creation and curation. The value of most content is so low relative to the cognitive, financial, and opportunity costs associated with making a payment that few readers choose to tip. The abundance of free alternatives means that enforcing a ‘paywall’ will drive readers elsewhere. There have been several attempts to implement per-article micropayments from readers to authors, but none have become widespread."

So, you're saying that "content" = "currency"? But comments do not generate steem for people. But you can vote on those comments and generate steem for the author of those comments. At this point, you're conflating so much that I'm not even sure what the hell you mean by anything you're saying.

"Steem is designed to enable effective micropayments for all kinds of contribution by changing the economic equation. Readers no longer have to decide whether or not they want to pay someone from their own pocket, instead they can vote content up or down and Steem will use their votes to determine individual rewards."

Oh my god this is giving me brainfreeze. I have to stop.
I'm saving this notepad note and I'll come back to it later.
You won't even know the difference, since no time passes between then and now.

Ok. I don't even know what to say.
Ok. Were it not for the "2 year" thing, which necessitates a large payout to make each week "worth it" in terms of money or possibility, NO, because you can't get voted up by, say, 10 people, get $1 for it, and then cash it out into Paypal.I'm saying that there's a false equivalence here. In speaking about the "costs" of micropayment, what's being missed or left out is how very much MACRO the payments have to be for anything to happen!Likewise, the tipping is about the generated content on the system, which could amount to 100 spammy posts -- it's contribution!

I'm not even saying this is ripe for scamming. I'm saying that there's an entire mismatch of method and philosophy.

"Voting input from community members is critical for Steem to accurately allocate payments to contributors."

Explain.
And then why isn't there a downvote button? No, FLAGGING IS NOT AN APPROPRIATE TERM, NOR USE; FLAGGING IS NOT DOWNVOTING, AND IT'S BEEN PART OF THE CENTRAL TRAGEDY THAT IT WAS IMPLIMENTED AND THE DOWNVOTE WAS GOTTEN RID OF!

"Steem chooses to reward those who contribute the most to the total promotion of a piece of content and rewards the voters proportional to the ultimate reward paid to the content creator."
HOW? You're so sparse on the method! Is it to protect it? Well it's creating confusion!

"STEEM is constantly increasing in supply by 100% per year due to non-SMD incentives."
What is SMD? (AH HAH! It's Steem Dollars! Finally got far enough in the reading that it said it!)

"Someone who holds STEEM without converting it to SP is diluted by approximately 0.19% per day."
So, you're supposed to convert your STEEM to SP? Why isn't that done automatically then?

"The majority of inflation is actually an accounting artifact rather than true reallocation of wealth. 90% of non-SMD inflation is distributed back to existing holders of STEEMproportional to the STEEM value of their SP balance, making inflation more of a “split”."

I have no idea what the fuck any of that means.

"Because Steem wants to encourage long-term growth, it is hardwired to allocate 9 STEEM to Steem Power (SP) stakeholders for every 1 STEEM it creates to fund growth through contribution incentives."
And how is that 1 STEEM created?

"SP can only be converted back to STEEM over 2 years via 104 equal weekly payments. ‘1 SP’ can be viewed as a share in a pool of STEEM. The network automatically adds STEEM to the pool every block."
... How is a block created, then?

"At any time users can convert their STEEM into SP at the same ratio as STEEM in the vesting pool to total SP. Converting STEEM to SP does not dilute existing holders of SP."
Oh God you think I know what these terms mean? You're speaking Greek!

"SP balances are non-transferrable and non-divisible except via the automatically recurring conversion requests. This means that SP cannot be easily traded on cryptocurrency exchanges.SP is a requirement for voting for or against content. This means that SP is an access token that grants its holders exclusive powers within the Steem platform. Transferring from STEEM to SP is referred to as powering up while transferring from SP to Steem is referred to as “powering down.” For example, one can power down their STEEM over a period of two years, yet one can power up their STEEM instantly."

So... SP is what you use the vote.
Ok. So, powering up is transferring STEEM to SP, and that's what people want you to do, so you can then vote on their content and transfer... STEEM to them thereby?
No, but powering down their STEEM over 2 years... ffs.

"Steem Dollars (SMD)Stability is an important feature of successful global economies. Without stability, individuals across the world could not have low cognitive costs while engaging in commerce and savings. Because stability is an important feature of successful economies, Steem Dollars were designed as an attempt to bring stability to the world of cryptocurrency and to the individuals who use the Steem network. Steem Dollars are created by a mechanism similar to convertible notes, which are often used to fund startups. In the startup world, convertible notes are short-term debt instruments that can be converted to ownership at a rate determined in the future, typically during a future funding round. A blockchain based token can be viewed as ownership in the community whereas a convertible note can be viewed as a debt denominated in any other commodity or currency."

WHAT THE FUCK ARE YOU SAYING?

"SP holders elect individuals to publish price feeds."

... What???

"These elected individuals are presumably trusted by those who have a vested interest in the quality of the feed. By paying those who are elected, Steem creates market competition to earn the right to produce feeds."

I also like turtles.

"Given a set of trusted and elected feed producers, the actual price used for conversions can be derived as the median of the feeds."

So, the price is determined by election. This is democracy? I thought you were ancaps?

"In this way if any minority of individual feed producers produce outliers they have minimal impact on the actual median while still having the ability impact their reputation. Even if all feed producers are honest, it is possible for the majority of feed producers to be impacted by events beyond their control. The Steem network is designed to tolerateshort-term corruption of the median price feed while the community actively works to correct the issue."

Something is rotten in Denmark.

"As long as the price feed corruption lasts for less than half the moving median time window it will have minimal impact on the conversion price. In the event the feed does get corrupted, network participants will have an opportunity to vote-out corrupt feed producers before the corrupted feed can impact the actual conversion price. Perhaps more importantly, it gives feed producers an opportunity to detect and correct issues before their feeds start impacting the price."

Now here's something I recognize; I said it myself near the beginning of this.

AH - look at THIS:
"The blockchain decides how and when to create SMD and who should get it."
THERE'S that answer I was looking for. Now... HOW does it decide that?... I'm skimming now. I'm not even a third of the way through."The primary concern of Steem feed producers is to maintain a stable one-to-one conversion between SMD and the U.S. Dollar (USD)."
Why?

I got tired of trying to make sense of Whitepaper and started looking for videos.

This one is good:

I'm sorry... something doesn't feel right.

Or... I don't know...